ClickZ Walmart Insights Newsletter - 12.18.2024

PLUS: Chile's $1.3B expansion & Meituan deal reshapes China strategy

Author

Rachael Kennedy
December 18, 2024

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Welcome to Walmart Insights, your go-to newsletter for updates and analysis on the trends shaping retail and e-commerce at Walmart. This will be our last edition of 2024 so on behalf of all the ClickZ team, we wish you a Happy Christmas and we’ll see you all again in the new year!

Top Reads 🌟

Walmart’s fintech arm, One, is poised to transform the retail giant financial services landscape by taking over its co-brand and private label card portfolio. This initiative, set for next year, follows Walmart’s split with Capital One and positions One as a formidable player in the payments arena.

With a fresh $300 million funding round led by Walmart and Ribbit Capital, One valuation has soared to $2.5 billion, underscoring its potential to reshape the financial services sector. Walmart’s card program, once a behemoth in the co-brand space, represents a colossal revenue opportunity for One. By internalizing the card program, Walmart gains greater control and leverage in negotiations with future banking partners.

The upcoming pay-by-bank offering with Fiserv in 2025 further exemplifies this approach, aiming to cut down on costly swipe fees.

Specialty Bites 🍪

Walmart de México y Centroamérica plans to challenge a ruling by Mexico’s antitrust authority, COFECE, which fined the company for monopolistic practices. Despite the fine, Walmex asserts compliance with laws and will continue supplier negotiations, emphasizing strategic consumer benefits and questioning the investigation’s validity.

Over the next five years, Walmart plans to open 70 new stores in Chile, creating 4,000 jobs and expanding into regions like Vallenar and Pozo Almonte. This expansion is a calculated effort to integrate sustainability into its operations.

By 2025, over 80% of Walmart Chile’s energy will be renewable, thanks to solar panels in more than 50 stores and 25 new recycling points. This aligns with Walmart’s global goal of becoming a regenerative company by 2040.

The logistical challenges of operating in Chile’s diverse climate, particularly in the southernmost region of Punta Arenas, highlight Walmart’s innovative supply chain strategies. The company has developed multi-modal routes and a reserve storage system, El Oso, to ensure consistent supply despite extreme weather. This adaptability is a testament to Walmart’s strategic foresight and commitment to customer service, even in remote areas.

Costco has come out on top in Canada’s grocery market, excelling in price, promotions, and operations. In a Dunnhumby study, Costco’s strategic success was highlighted, emphasizing the importance of adapting to consumer needs. In the same study, Walmart was shown to excel digitally, while Amazon’s presence continues to grow. Retailers with strong value propositions thrive, underscoring the need for strategic alignment with evolving customer behaviors.

Walmart has sought to accelerate its e-commerce rollout in China through a strategic partnership with local shopping platform Meituan. Meituan has begun delivery services on behalf of Walmart under the deal, with the US retail giant also set to feature on its app.

Walmart noted in a WeChat post on Tuesday that the partnership would help boost e-commerce operations in China, with the division accounting for almost half of its sales there.

Walmart’s deal with Meituan comes after the sale of a $3.7 billion stake in Chinese e-commerce firm JD.com in August.

Influencer Corner 📣

Google's decision to stop prioritizing PMax over Shopping campaigns is already making waves. Shopping CPCs have doubled YoY, reflecting advertisers’ growing shift back to Shopping for better control and strategy. With Shopping spend set to increase further, CPCs could spike even more.

READ INSIGHTS FROM JOSH DUGGAN HERE 👉

Calculating CAC Ratio, Payback Period, and LTV:CAC can seem complicated

And you may be tempted to defer to finance.

But, if you’re finalizing your marketing budget right now, you need to check if it’s efficient.

Here’s a primer on how to calculate these efficiency metrics, and what they actually mean…

Emily Kramer, MKT1

Performance Pulse 📈

Performance marketing in 2025 will focus on strategic use of AI, first-party data, and personalized engagement to enhance customer loyalty and efficiency. As costs rise and effectiveness declines, marketers must prioritize creativity and strategic value. Agencies face pressure to adapt, while skills in strategy and technology become increasingly vital.

TikTok ads require strategic optimization for success. Key steps include defining objectives, refining audience targeting, enhancing ad creativity, and utilizing automated bidding. Additionally, adjusting ad placements, retargeting, and leveraging advanced features are crucial. Continuous testing and alignment with TikTok trends ensure maximum ad performance and brand visibility.

Influencer Partnerships

Crocs ➡️ Influencer Marketing Manager

📍 Broomfield, CO

Marketing & Communications

Fospha ➡️ Partnerships Executive

📍 Austin, TX, USA

Affiliate Marketing

Macy’s ➡️Director, Affiliate Marketing

📍 New York, USA

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